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Hikma Pharmaceuticals
(OTC:HKMPY)
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Rating:70Outperform
Price Target:
$47.00
▲(5.45% Upside)
Action:Reiterated
Date:08/06/26
The score is supported by very strong valuation (very low P/E and solid dividend) and a constructive technical trend (price above key moving averages with positive MACD). The main constraint is financial quality: cash flow has weakened and leverage has risen despite improving reported profitability. Earnings call commentary is broadly positive with reiterated guidance and operational progress, but includes clear H2 execution and demand/phasing risks.
Positive Factors
Diversified commercial footprint; strong MENA branded performance
Hikma's mix across branded, generics and injectables reduces single-market risk; MENA branded outperformance delivers mid-to-high single-digit growth and mid-20s margins, providing a durable, higher-margin revenue base supported by local brands, tenders and an established salesforce.
Negative Factors
Weak operating cash flow and poor cash conversion
Cash generation has deteriorated with FCF falling sharply and covering less than half of net income. Persistent weak cash conversion undermines the company's ability to fund capex, pay down debt, pursue M&A or sustain shareholder returns without relying on external financing, a material fundamental constraint.
Read all positive and negative factors
Positive Factors
Negative Factors
Diversified commercial footprint; strong MENA branded performance
Hikma's mix across branded, generics and injectables reduces single-market risk; MENA branded outperformance delivers mid-to-high single-digit growth and mid-20s margins, providing a durable, higher-margin revenue base supported by local brands, tenders and an established salesforce.
Read all positive factors
Hikma Pharmaceuticals (HKMPY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.29B
Dividend Yield4.16%
Average Volume (3M)177.00
Price to Earnings (P/E)11.3
Beta (1Y)0.52
Revenue Growth5.61%
EPS Growth6.41%
CountryUS
Employees9,400
SectorHealthcare
Sector Strength45
IndustryDrug Manufacturers - Specialty & Generic
Share Statistics
EPS (TTM)3.60
Shares Outstanding104,373,820
10 Day Avg. Volume0
30 Day Avg. Volume177
Financial Highlights & Ratios
PEG Ratio0.88
Price to Book (P/B)1.78
Price to Sales (P/S)1.38
P/FCF Ratio28.48
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Hikma Pharmaceuticals Business Overview & Revenue Model
Company Description
Hikma Pharmaceuticals PLC is a global pharmaceutical company that specializes in the development, production, commercialization, and distribution of a wide array of generic, branded, and in-licensed medicines. These pharmaceuticals are provided in...
How the Company Makes Money
Hikma makes money primarily by manufacturing and selling pharmaceutical products across three main business segments: (1) Injectables: revenue is generated from supplying generic injectable medicines (e.g., sterile injectables) to hospital and ins...
Hikma Pharmaceuticals Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Feb 25, 2027
Earnings Call Sentiment Positive
The call presented a broadly positive operational and financial picture: H1 delivered improved profitability (EBIT/EBITDA ~+8%, EPS +5%) and management reiterated full-year guidance while detailing clear operational fixes, R&D and capacity investments (injectables stabilization, U.S. manufacturing expansion, and CMO/Rx pipeline progress). Offsetting factors include geopolitical-driven stockpiling that may depress H2 volumes, the divestment of a loss-making 503B compounding business, some pricing pressure in oral Rx, and near-term variability in CMO revenues. On balance the company emphasized progress on key strategic initiatives and a constructive pipeline, but retained caution on phasing and H2 execution risks.Positive Updates
Profitability Improvement
EBIT and EBITDA increased by almost 8% year-on-year; EPS rose by 5% in the interim results (H1), and reported H1 operating profit was $405m, supporting management's decision to reiterate full-year guidance.
Negative Updates
Geopolitical Uncertainty and Stockpiling Effects
Ongoing conflict and instability in the MENA region created temporary stockpiling that boosted H1 sales but could depress demand in H2 as inventories are drawn down; management emphasized caution for H2 planning.
Read all updates
Q2-2026 Updates
Positive
Negative
Profitability Improvement
EBIT and EBITDA increased by almost 8% year-on-year; EPS rose by 5% in the interim results (H1), and reported H1 operating profit was $405m, supporting management's decision to reiterate full-year guidance.
Read all positive updates
Company Guidance
Hikma reiterated FY26 guidance of group revenue growth of 2–4% and operating profit of $720–770m (H1 operating profit was $405m), noting H1 was ~55% weighted for sales; H1 results showed EBIT and EBITDA up almost 8% and EPS up c.5% year‑on‑year, R&D spend and other investments are up, and management cited a 10‑year CAGR of c.8% for sales and c.5–6% for profitability. They said the injectables business is stabilised with CMO revenues expected to pick up in H2 and a major Bedford injectable capacity due in 2028, reiterated a target of 20% of Rx revenue from CMO by 2030, and described branded as able to deliver mid‑to‑high single‑digit top‑line growth with mid‑20s margins (Rx margins approaching ~20%). The buyback is almost complete (about $230m deployed, ~11–12m shares) and the 503B compounding unit is classified held‑for‑sale (expected to be sold within 12 months).Hikma Pharmaceuticals Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
67
Positive
Cash Flow
52
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.41B | 3.36B | 3.13B | 2.88B | 2.52B | 2.55B |
| Gross Profit | 1.40B | 1.44B | 1.42B | 1.41B | 1.24B | 1.30B |
| EBITDA | 889.38M | 781.82M | 727.00M | 559.00M | 688.00M | 766.00M |
| Net Income | 386.34M | 402.94M | 359.00M | 190.00M | 188.00M | 421.00M |
Balance Sheet | ||||||
| Total Assets | 5.83B | 5.67B | 5.13B | 4.68B | 4.47B | 4.37B |
| Cash, Cash Equivalents and Short-Term Investments | 289.00M | 354.00M | 213.00M | 229.00M | 292.00M | 450.00M |
| Total Debt | 1.96B | 1.60B | 1.31B | 1.19B | 1.28B | 846.00M |
| Total Liabilities | 3.29B | 3.06B | 2.81B | 2.47B | 2.32B | 1.91B |
| Stockholders Equity | 2.52B | 2.59B | 2.31B | 2.20B | 2.13B | 2.45B |
Cash Flow | ||||||
| Free Cash Flow | 148.88M | 162.38M | 329.00M | 404.00M | 305.00M | 409.00M |
| Operating Cash Flow | 398.53M | 359.84M | 564.00M | 608.00M | 530.00M | 638.00M |
| Investing Cash Flow | -325.62M | -394.92M | -381.00M | -333.00M | -607.00M | -238.00M |
| Financing Cash Flow | -45.38M | 58.14M | -188.00M | -337.00M | -58.00M | -287.00M |
Hikma Pharmaceuticals Technical Analysis
Neutral
44.57
Price Trends
42.60
Negative
40.36
Positive
39.00
Positive
Market Momentum
0.06
Positive
35.64
Neutral
4.57
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HKMPY, the sentiment is Neutral. The current price of 44.57 is above the 20-day moving average (MA) of 43.94, above the 50-day MA of 42.60, and above the 200-day MA of 39.00, indicating a neutral trend. The MACD of 0.06 indicates Positive momentum. The RSI at 35.64 is Neutral, neither overbought nor oversold. The STOCH value of 4.57 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HKMPY.
Hikma Pharmaceuticals Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $42.57B | 57.88 | 9.18% | 5.80% | 4.33% | ― | |
70 Outperform | $4.29B | 11.31 | 15.05% | 4.16% | 5.61% | 6.41% | |
62 Neutral | $9.97B | 28.78 | 8.88% | 0.71% | -6.76% | -44.35% | |
60 Neutral | $5.51B | 33.91 | -326.75% | ― | 9.28% | 4917.17% | |
59 Neutral | $18.95B | -45.50 | -2.79% | 2.93% | 4.92% | 87.81% | |
54 Neutral | $1.99B | -1.09 | -55.97% | 8.54% | -4.18% | -2138.82% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
HKMPY
Hikma Pharmaceuticals
40.53
-2.48
-5.78%
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11.71
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PRGO
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TEVA
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36.35
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AMRX
Amneal Pharmaceuticals
16.87
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67.20%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.